New Transatlantic Body Meets in Pittsburgh
By Malcolm Ramsay
Deeper trade relations between the U.S. and the European Union promise to boost the outlook for transatlantic breakbulk volumes, as authorities explore ways to reduce barriers.
Representatives from the two superpowers held the first meeting of the newly formed EU-U.S. Trade and Tech Council, or TTC, in Pittsburgh at the end of September, announcing a joint aim to promote "competitiveness and prosperity.
Godfried Smit, international policy director of Dutch trading association EvoFenedex, told Breakbulk that “it is obvious that the negotiations are going into a direction of more exchange of data which end up with more efficient controls which could reduce the impact of border controls,” however cautions that talks are still at a “very early stage” and it “is therefore extremely difficult” to make direct predictions of consequences.
Regulatory Alignment
Officially announced in June, the TTC was launched with a remit to serve as a forum for the U.S. and European Union to coordinate approaches to key global trade, economic, and technology issues while at the same time deepening transatlantic trade and economic relations.
Co-chaired by EU Competition Commissioner Margrethe Vestager, EU Trade Commissioner Valdis Dombrovskis, U.S. Secretary of State Antony Blinken, U.S. Secretary of Commerce Gina Raimondo, and U.S. Trade Representative Katherine Tai, the new TTC aims to build on "common democratic values" and translate these into "tangible action." Speaking at the launch, Vestager called for the partners to “work for a human centered digitization and open and competitive markets.”
Despite these shared values, the two trade blocks have faced strong headwinds this year, as early signs of economic resurgence following the global pandemic have been crushed by worsening supply chain issues and a global energy crisis. While this has provided a temporary boost to the bottom-line of many breakbulk shipping lines, as charter rates have shown record growth and hit new heights this year, the longer-term outlook is gloomier as the world’s major economies face stuttering to a halt in the face of rising inflation and unprecedented debt levels.
For this reason, Smit of EvoFenedex predicts that there will be pressure for alignment “on rules on export controls and dual use” leading to a positive result for transatlantic trade should negotiations progress successfully.
Green Agenda
Since coming to power in January, President Biden has been keen to shift policy direction towards a more multilateral approach, and Smit notes that it’s “clear that in line with the general tendency in trade, agreements are becoming more ‘inclusive’ and due diligence and labour conditions will be part of the negotiations.”
Renewed investment in green development is also opening the potential for greater breakbulk traffic between the U.S. and Europe as energy companies look to take advantage of the Biden administration’s massive US$2 trillion spending commitment to tackle climate change over the next four years.
A key pillar of White House policy, the Bipartisan Infrastructure Framework, has sped up approval for new renewable projects, with construction of new onshore and offshore wind farms poised to accelerate. Smit expects that emissions will be a key talking point in discussions, noting that “Europe has its Green Deal and Fit for 55 and it would be helpful in having an alignment in the transatlantic trade. The agreement might also be a chance to have a more tight collaboration between the competition.”
Wind Power Cooperation
Having lagged other regions in terms of wind power development over the last decade, the U.S. is now poised to ramp up construction with European firms are at the forefront of efforts to build new projects and enhance breakbulk infrastructure.
Heavyweight renewable developers and manufacturers from across Europe are already committing billions to the growing U.S. market and plan to invest in ports and staging areas to handle the necessary influx of project cargo. Developers have also rushed to participate in new offshore lease auctions offered by the Bureau of Ocean Management, as part of its strategy to create new wind energy areas along both coastlines of the country.
Among the largest players is Danish wind giant Ørsted, which owns the first commercial offshore wind farm in the U.S., the 4 gigawatt Block Island project, and it is expected to be joined by fellow European firms SSE Renewables, ENGIE, Vestas, TotalEnergies, and SiemensGamesa, which are all lining up to participate in new auction rounds.
The U.S. Department of Energy reports that a record 16.8 gigawatts of new utility-scale land-based wind power was added in the U.S. in 2020, accounting for 42 percent of new capacity in the country. Plans for the country’s first utility-scale offshore project, the Vineyard Offshore Wind Project, are progressing rapidly and the proposed Massachusetts wind farm is expected to act as a template for a raft of other new projects once it is operational. Developed by Danish fund Copenhagen Infrastructure Partners and Spanish electric utility Iberdrola’s Avangrid subsidiary the project aims to create a new blueprint for projects in the U.S.
Christy Guthman of General Electric predicts that as soon as “Vineyard Wind, is fully permitted, built and operating” the industry will “scale up very quickly,” adding that it will advance plans for more than 14 GW of offshore wind projects by establishing “a permitting template and provide lessons learned that can be applied to future projects.”
The White House plans to build 30 GW of wind capacity by 2030 and has backed efforts by the Bureau of Ocean Management to fast track licences for development under its Outer Continental Shelf Renewable Energy Program.
